A budget cut is a budget cut. Everybody recognises one when in front of one. Organizations don’t impose them just for fun. Usually there is a good reason.
A reasonable expectation of a budget cut is that people will look more critically at resources and possibilities, perhaps trade offs.
A budget restriction may have started from the top: we can’t do everything, we need to choose, think critically about how we spend our money and prioritize. So far so good. The next ‘so what’ says: by the way, we need to cut travel expenses; as from now, no intercontinental travel. Then somebody, somewhere passes the baton: no off sites, no consultants. The trickle continues and touches facilities management: no more peanuts and mints in meeting rooms, let alone bringing sandwiches for all at the team meeting. At that point, the overall company narrative is about ‘what we don’t do’. The company transforms itself from a company that does things to a company that doesn’t. You define yourself by what you don’t do.
What a minute? Where does this thing about the mints come from? Well, it’s the budget! Cutting across the board includes the mints. Lucky we stopped at toilet paper.
Let me go back to my original sentence about expectations: A reasonable expectation of a budget cut is that people will look more critically at resources and possibilities, perhaps trade offs. I said. The expectation was an increase in critical thinking. The result is a decrease: I don’t have to think about choices anymore. Choices are made for me. This is to the list of things I won’t do. When before you could do X,Y and Z, now you are supposed to look at X,Y and Z and chose wisely. But somebody in the process decided that you will stop X and Y and will do Z. Budget cut, choice made.
For every budget restriction installed there is a possibility of a flawed communication about that budget restriction. Say cuts, people hear bad news, bad shape, going down, lack of control, flagging system. Add the lack of mints, and you are soon into misery.
It’s incredibly easy to create a depressing atmosphere: take away the mints. OK, and the travel and the Christmas lunch.
Leaders are often blind to the halo effects of strategic decisions. They prescribe A and suddenly A comes attached with B,C,D. An uncritically presented decision, uncritically followed by uncritical people leads to the Robo-Organization. Thinking postponed.